Ethereum Foundation Cuts 20% Of Staff And 40% Of 2026 Budget In Restructuring

The Ethereum Foundation cut its staff by 20% and its 2026 budget by 40% as part of a leadership shakeup and a months-long restructuring effort.

The foundation said it eliminated 54 positions, representing about one-fifth of its staff, and reorganized around five core work clusters including protocol development and user access.

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In explaining the layoffs, the foundation said, "This was a difficult decision, but it was necessary."

The restructuring also included financial-model changes by co-founder Vitalik Buterin, shifting toward a donation-based model to reduce annual operating expenses from approximately 15% of financial holdings to approximately 5% by 2030, with a 40% reduction by 2026.

During the restructuring, co-executive director Tomasz Stanchak resigned in February 2026 and co-executive director Xiaowei Wang resigned in June 2026, with seven other executives resigning as well.

On an interim basis, board member Bastian Auwe succeeded Wang, while the foundation said the new organizational structure would be run through five core work clusters alongside management and support.

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Buterin acknowledged the value loss in a statement that said, "I'm not going to pretend that we haven't lost anything of value."

The foundation also said employees laid off would receive severance pay equivalent to either their salary or the minimum wage mandated at their location, whichever is higher, and would be provided with transition subsidies for career coaching and placement support within the ecosystem.

Trenton Van Epps warned that the core development ecosystem would face a structural funding shortage in three to nine months due to the expiration of customer incentive programs and the convergence of financial cuts.

CoinDesk’s The Protocol Newsletter described the upheaval as prompting questions across crypto about the future of Ethereum and the health of one of the network's most influential institutions.

Stacey Muur, founder of GreenD0ts, wrote on X that, "This is a crisis for EF," while Joseph Chalom, CEO of SharpLink, told CoinDesk, "We are at the edge of something remarkable for Ethereum."

CoinDesk also quoted Anatoly Yakovenko, co-founder of rival blockchain Solana, saying, "Bullish, fr," as he characterized budget constraints as forcing prioritization and focus.